Tesla Model S Gets A Stealthy Price Bump

Tesla delivered on its promise to sell a $50,000 EV, and then promptly cancelled production of the 40 kWh Model S, and followed that with a $2,500 price increase for the remaining variants. Well Tesla is at it again, discreetly jacking up the price on certain option packages that could add thousands of dollars to customers waiting for their cars.

HybridCars reports that average the Tesla website went down for maintenance last week, it came back online with new base prices for the Model S sedan, as well as some substantial price increases for customers with cars on reserve. One Tesla Model S owner who bought his car in December estimated that the same car would have cost him $10,000 more had he waited until now to buy it.

Some of this price increase comes from a bump in the Tesla’s base price, which was quietly increased by $1,170 for both the 60 kWh and 85 kWh models. That brings the base price for the 60 kWh Model S to $71,070 (up from $69,900) and $81,070 for the 85 kWh variant, not including the $7,500 tax credit.

Similarly, some option packages have gone up in cost as well, or been replaced entirely. The $950 “Studio Sound” package has been replaced by the $2,500 “Ultra High Fidelity Sound” package. One customer with a car on order had his car cost increased by $6,000, causing him to reconsider his order entirely. No word on if this price bump affected the Model S lease as well.

It is certainly a questionable tactic, one that could cost Tesla buyers and fans. A more transparent announcement may not have been recieved with excited celebration, but trying to slip one under the noses of people spending close to six-figures on a car is a terrible idea. Tesla may be the darling of the green tech world right now, but that doesn’t mean they can do no wrong.

About the Author

Christopher DeMorro A writer and gearhead who loves all things automotive, from hybrids to HEMIs, Chris can be found wrenching or writing- or else, he's running, because he's one of those crazy people who gets enjoyment from running insane distances.

The ‘Jerking About” of aluminium prices by the Big American Bankster Houses have anything to do with this? Tesla is being driven to China’s shores by U.S. Financial “wizardry’, crookedness, and outright dishonest non productive profiteering? Are Americans being bled to death by their own kind? Are the “parasites” actually destroying the last health of the American body?

The 40 kWh Model S was cancelled due to low demand. There were so few orders, it wasn’t worth the trouble to keep the 40 kWh version in production. Model S buyers wanted more range, and they were willing to pay for it.

The $1,170 base price increase for the 60 & 85 kWh versions hardly seems unusual, considering that the car has been out for 14 months. Tesla has actually made it easier to get the specific options you want by decoupling some of the original options packages. Yes, certain items have gone up in price, but so has the quality.

Christopher DeMorro

@ Todd

There’s nothing wrong with raising the price of a product. But doing so on the sly just seems a little sketchy is all.

QKodiak

Ford shares $2,950 for the massive retractable panoramic glass roof on their MKZ. It’s the only one bigger than the Model S’s, and Tesla now charges $2,500 for it, up from $1,500. Also, there are some new options such as footwell and door lights, parking sensors, redesigned fog lights that work with the cornering lights, and gen II smart air suspension.

Unfortunately, those last three options are only available if you first get the $3,500 tech package, and XM Satellite Radio is only available if you get the $2,500 ultra high fidelity sound package.

I wish it was more customizable with customers getting what they want and not paying extra for options they don’t want or can’t justify the cost. (some are really stretching their budgets to get it as it is) Also, prerequisites are annoying esp. when designing your dream car (Why can’t I have X with Y?!!)

I agree. Some of the options pairings still don’t make perfect sense. For example, requiring that you buy the High Power Wall Connector if you want Twin Chargers is problematic. The HPWC won’t work in every home, but twin chargers are useful in other situations—such as being able to charge faster when your car is in for service. I mentioned it to Tesla.

Albert

Most people, given the choice, would rather drive a Tesla than ANY other car. That is the bottom line for Tesla. I have paid similar prices, and for the same options, in much lesser cars.

The model S has the best evaluation score of any car, is all electric, and is the best for the environment: absolutely clean 250 miles per charge. Even the most entitled consumers chose Tesla over the imports. Producing more units is simply a question of making the factory bigger, opening new installations, etc… Tesla’s revenue increased by 3000% (three thousand percent) this year – their stock price has only increased by a tenth of that.

With regards to Tesla…

The most important ratio: How are consumers living now vs how they can live with a product/infrastructure from a company. That ratio is very high in favor of Tesla.

If you had a stock that started at $1 and then went up to $5, you would have a 500% increase, right? If the true price of that stock, by market forces still in the process of reconciling themselves was, say, $290, this “500% increase” would be un-impressive compared to where the stock is actually going. The discrimination in this analysis relates to the fact that Tesla is a new car company. In fact, it is the only successful new car company. It would be extremely difficult for one of the other car companies to achieve this level of growth because their market forces have already reached equilibrium. Thus, these growth rates for Tesla are to be expected and are, quite frankly, trivial to the growth that they are yet to achieve; given the context of the success of their business model and amazing total product (car, infrastructure, etc…). Once this existencial crisis within the financial analysis of Tesla vs other car companies is surpassed, a clear view of the prospects emerges.

The unique circumstances for Tesla are clear:

1- First truly successful electric vehicle platform (by any means of comparison to any other car of any type). Highest rating of any car ever.

2- Has quickly captured the market share (in 1 year!!!) for the price segment f it’s first model – % limited only by its first-year’s ability to produce the cars.

3- Has a streamlined, new-to-the-industry, ultra-efficient production process for a product with vastly less moving parts. The facility where they are located used to produce 500,000 gas-engine vehicles using a much less efficient process – Tesla is currently at just 4% of that capacity in that facility alone. Even by old efficiency standards, they could produce 25 times the volume they have now, just in that facility. Their production volumes are accelerating quickly.

4- Commands tremendous global demand. People are in line for months with thousands put upfront.

5- It is the only car company with the ability to dedicate itself exclusively to the perfect electric vehicle because the other companies are tied-down into gas-engine commitments for the vast majority of their profits. Tesla has invested decades exclusively to this purpose – that is how far ahead they are.

6- Gas engine cars and their infrastructure are depreciating even faster than before. Tesla cars, by definition, retain their value.

7- Tesla cars provide unprecedented, vastly unmet, environmental value to society. Even if you don’t have a Tesla, you are glad someone else does.

8- Has just opened it’s doors to an international markert hungry for its cars. They are the “it” car in many ways.

The main point is that Tesla has a number of market forces pushing it to grow, not linearly, but exponentially. That means that the projections for Tesla today are much less than the projections for Tesla tomorrow. Investors are now having a clearer picture of what to do with a car company with prospects that are this amazing. The answer is obvious.

OldGyrene

Ha! Given the choice most people would rather drive a Lambo, Ferrari or Bugatti! What you meant to say is most “TREE HUGGERS”, given the choice……….

Spoken like someone who’s never spent any real seat time in any of those.

Anton Mitchell

@harshcougar This article is misleading. For those folks who already have their Model S’s on order prior to last week – the price of their configured car, assuming the buyer has place their order deposit – there is no automatic price increase. The operable word is ‘automatic’. However, if the buyer chooses to reconfigure their car because for example they want the new parking sensors, then Tesla will in essence cancel the original order and start over with the new pricing. The buyer does not loose they place in the production que but there will be a price increase for the reconfigured car.
By the way – $950 for the sound system was a steal! The price of $2500 is more in line with the incredible power and fidelity of the system. Although I feel Parking Sensors and Fog Lights on a Model S should be an automatic standard $500 is not out of line.
PS – I know this for I have a Model S on order since this July and I spoke with a Tesla Inside Sale Rep (for I wanted the Parking Sensors!) 🙂

AustinAnthony

The $1,170 has been charged to all customers and is not a price increase, it is actually just the “Destination and Regulatory doc fee” – I paid it 3 months ago when I bought mine and this charge was clearly communicated during the sales process.

Yes, the $950 for the sound system upgrade was a steal.

Additionally, since less than 4% of vehicles were configured with the 40KWHr battery, which was under $50,000 after the $7500 rebate, this low volume did not warrant production of the vehicle. Instead, Tesla sold every 40KWHr reservation holder a 60KWHr vehicle at the 40KWHr price. Even though they software limited these to 40KWHr, every customer actually got a better car that they can upgrade anytime they want in the future to use the full 60KWHr. Tesla probably took a loss on those cars but did the right thing to support their customers with their commitment.

Nonna Yobizness

Tesla does not lease, they offer financing. Get the facts!

Jo Borras

You are incorrect. Tesla does, in fact, lease – they call it a “financing option”, which it is. Get the facts, backatya! 🙂

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